Health insurance premiums going up

The cost of health insurance just increased for millions of Californians, and the timing is important because it's possible that in a few weeks insurance companies won't be able to do what they did on Friday.

The latest rate hike by some of the state's largest health insurers affect 1.5 million Californians, mostly small business and individual policy holders. The premium jump ranges from as small as three percent to a whopping 92 percent.

For some customers, it's the third rate hike in less than a year.

"I have the authority right now to reject excessive rate hikes for auto insurance, homeowners insurance, property insurance and casualty insurance, but not health insurance," said California Insurance Commissioner Dave Jones.

The health insurance industry says the rise in rates reflects a rise in health care costs, including increased hospitalizations and diagnostic testing.

"I decided I was willing to take that risk," said 56-year-old Pam Suwinsky, who decided $700 a month for just herself was too expensive and canceled her health insurance.

"I didn't really understand why they would go up so much," said Suwinski. "There's no change in my health status, and I wasn't getting any additional benefits."

The increasingly expensive policies are giving momentum to Assembly Bill 52, which grants the Insurance Commissioner the power to reject rate hikes. But the California Medical Association says price controls may not be the answer because the insurance industry will find a way to keep their record profits that, in the end, hurt consumers.

"One of the ways to generate profits is to make cuts in the way they provide healthcare, which means less access to physicians, less access to care and less benefits," said Francisco Silva with the California Medical Association.

But Jones says they're charging more than is necessary to cover medical costs.

"It's going to drive more people off the health insurance rolls and more people into the emergency rooms," said Jones.

Assembly Bill 52 faces a key committee vote on Wednesday. Nearly three dozen states already give their Insurance Commissioners the power to reject rate hikes on health insurance policies.